Employment law isn’t always stacked in the favour of employees you know. Chadburn made up race discrimination allegations to inflate her claim against Doncaster NHS foundation Trust and in doing so the Trust invested an additional £35K in defending itself. The Employment Appeal Tribunal took a dim view and awarded £10K costs against Chadburn, ignoring her pleas that she was £4k in debt and couldn’t afford to pay.
Costs warnings are often used by Respondents (employers) if they feel that that employee’s claim is frivolous, misinformed or, in cases like this one, simply based on lies. Employees are sometimes under the impression that, fees aside, there is no risk to them in bringing a claim against their employer. Providing their claim is brought in good faith and is reasonably believed by the employee to be a genuine complaint then this is normally true, and each party must bear its own costs for representing itself during an employment tribunal.
Sometimes however an employee will have an over-optimistic view of their chances of success or will cross the honesty line to increase their chances of success or the value of their claim. In these cases we will consider asking for a deposit order (whereby the employee must pay a deposit for the case to continue) in conjunction with or after issuing a costs warning against the complainant. A ‘costs warning’ is effectively a document sent to the complainant to warn them that if they continue with their case (and if the tribunal later agrees that the case had no realistic prospects of success) then we will ask the tribunal to award costs against the employee in respect of our legal costs of preparing for and attending the hearing.
In Chadburn the costs order was relatively modest at about a third of the costs actually incurred by Doncaster in defending itself, sometimes a respondent will recover all of its costs via a court order.
Cases like Chadburn serve a useful reminder that a costs order can be an effective tactic in getting a Claimant to think twice before pursuing a frivolous claim, but the tactic should be used with caution. If a tribunal thinks a respondent has behaved threateningly, or that the case does have a realistic prospect of success, the tactic is likely to backfire. It is important then that costs orders are worded factually and non-threateningly and only used in situations where the complainant’s case is weak and/or we know they have lied in order to boost their chances.
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